It might not be the next housing bubble, but it could exacerbate one whenever it happens next. So imagine you’ve got a bunch of middle-class wage earners with tens of thousands of loans that cannot be discharged, and the next bubble strikes and leads to massive layoffs.
And as you and others have said, people can’t continue to put themselves into 10-20 years worth of debt without seeing the potential returns in income and job stability. I don’t know if that’s a bubble so much as an economic model that’s destined to fail.
It’s totally a rational market adjustment, at least for the humanities. The realities of the job market are seldom, if ever, discussed with grad students. The great majority of my cohort are working cruddy adjunct jobs or have totally given up on finding academic jobs; I really do think that the faculty in their 30s - early 40s may be the last generation to get stable TT positions (with the exception of those who have an Ivy League education and are networked enough to walk into an Ivy League job).
That makes me nervous; my nephew wants to start a PhD program in psychology, with the goal of going into academia. It sounds like it’s going to be hard for him to find a job, after spending six or seven years on the degree.
I’d have him do some rigorous research into the job market for academic psychologists. There are some jobs out there, but at my community college it’s not unusual to have have 300+ applicants for faculty positions. It’s a buyer’s market and many of our faculty are Ivy League graduates – it used to be that an MA/MFA was a ticket to working at a CC, but over the last ten years we’ve only hired Ph.D’s.
Perhaps your nephew could also have a fallback position if academia doesn’t work out?
We really should set the expectation with students who have this as their career goal that becoming a TT professor in English or Sociology is a little like making it as a pro athlete, or an actor (but with a smaller paycheck even if you make it).
And I’ve always found it a little shocking that there are so many PhD candidates in the humanities that seem to not realize this. I have a young friend who graduated with her undergrad in Anthropology and Political Science - and now, unable to find a job, figures that more education is what she needs. Fortunately for her, nepotism stepped in, she got an entry level college grad job that actually uses some of her study areas (Political public relations work), and may not end up six figures in debt for a Anthropology PhD and little chance of employment. And the more mature adults around her are saying “sit tight and if you decide to go back in a few years - MBA or law school - for now, work this job and your contacts and you may discover you don’t need to go back.”
The availability of guaranteed federal student loan money has to at least play a part. Imagine if the government guaranteed a loan of $30,000 at low (-ish) interest rates to everyone who wanted to buy a new car, regardless of credit history.
Is there any doubt that the car sales business would be booming?
But I don’t think that is all of it. When I went to school in the early 90s, the dorms were shitholes. No cable TV and certainly no internet. Cafeteria-style food.
I returned to my old school a few months ago and the dorms are palatial. New rec centers with indoor olympic pools, student union with massage chairs. I didn’t even recognize the place.
New administrative departments have cropped up everywhere. There is an entire department to assist gay and lesbian students feel welcome on campus. An entire department! Although I’m sure that every employee in that department puts in 14 hour days and passes out from exhaustion due to all of the work happening, take those salaries and multiply them by God knows what because of all of the other departments that have crept into existence.
And the thing is, student enrollment is roughly the same as when I went there, yet there are about eight brand new buildings in addition to the ones that were there when I was. It doesn’t add up.
When I was an undergrad, the school renovated dorms that were in a traditional academic quadrangle. The school’s argument for making them nicer than you’d expect was that they planned to use the dorms during summers to host visitors to conferences at the school.
With a daughter who just received her first acceptance letter - students and their parents aren’t making the decision on where to go based on price. From the flyers - dorm rooms and rec centers are a huge part of the decision making process.
Part of the reason no one makes a decision based on price is that college pricing is like health care pricing - you really don’t know what the price is going to be until the end of the process. A college with a $52k tuition could give you a $20k scholarship while the $43k a year school could offer you nothing. In the meantime, you are looking at where to apply and receiving acceptance letters - and while your mind may not be made up until all the offers of money are set in front of you, you wouldn’t be human if you didn’t have preferences long before that.
Its also time consuming and expensive to apply. The common app makes it a lot easier, but each school generally does something a bit different that needs to be added in. And each app is running her $40-$60 - well, except the schools that have offered her free applications - but she doesn’t want any of them. So you pick four or five schools, hoping the packages will come through. How do you pick them - from what you see in their promotional materials and then the research you do on the web. A school with 1970s dorms is a place you might not bother to apply to.
So as a college you need to make your brochure and your college visit weekend appealing. Or people won’t apply. And colleges do close.
One thing that I’ve been really disappointed by is the college prep - not the academics - but the thinking about college - my kids have gotten. Starting in their freshman year, they should start exploring their options for their post high school experience. You want the military - this is what that life is like. You want a small private liberal arts college - this is what that debt load is likely to look like. Kids should be encouraged to have a safety school academically - but they should also have financial safety options - community college, an in state public school, a school with state reciprocity from an even cheaper state. Plus they should be informed about AP options and dual enrollment options in high school that can help lower the overall cost (several kids in my daughters class will enter the University of Minnesota as Sophomores - the state having paid for the first two years of school dual enrollment). And they should have a good idea that getting a Masters in Social Work from a private college is not going to have a great ROI, social workers generally getting paid slightly above WalMart greeters. But my school has been LOUSY on that - both with students and with their parents.
One thing hasn’t been mentioned yet. We’ve talked about how government influences student decisions by making loan money available. People apply to school who wouldn’t without the loan money, and to more expensive schools than they otherwise would.
But government also plays a role by forcing people, more or less, to take college classes.
100 years ago, if you wanted to work as a gardener, a barber, a masseuse, or something like that, you just set up shop and started working. Today, if you want to work in such jobs, you must be licensed (in some states). Licensing generally means taking classes, sometimes hundreds of hours worth. The classes, of course, are often meaningless and unrelated to the job. There’s no reason why anyone would take them if the government didn’t force them to do so.
But for many people, that means if you want to earn a living, you have to take classes from a college or university. Obviously this benefits the colleges and universities immensely. They can raise prices, and the students don’t have much choice except to pay those prices.
Absolutely. When I entered Harvey Mudd College in 2000, tuition + room + board was about $35,000. Now it’s about double that. Every time I read about events on campus, I read about administrative positions that didn’t exist when I was there. “Dean of Health and Wellness”, “Associate Dean for Institutional Diversity”, “Assistant Vice President for Facilities and Maintenance”, etc… An no one ever talks about why these nonsensical positions exist.